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Us 12, Freddie 8, Hank Paulson 7, Washington 5, Mr. Paulson 5, Goldman Sachs 4, Henry Paulson 4, Aig 4, Porsche 4, America 4, Lehman 4, Tim Geithner 3, Hank 3, Ferdinand Porsche 3, John Mccain 3, Goldman 2, Narrative 2, Nancy Pelosi 2, George W. Bush 2, U.s. 2,
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  CNBC    The Kudlow Report    News/Business. Larry Kudlow.  

    February 1, 2010
    7:00 - 8:00pm EST  

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climbing the amazon list very rapidly. it is a first-person account of what mr. paulson and others thought was impending financial armageddon, peering into the abyss, with major financial companies failing left and right. all that in the autumn of 2008. a little more than a year ago. but today, as the system is healing, populist anger from the left and the right, rails against the rescue mission and the bailouts. the republican party has turned against its former treasury secretary. my question ask -- why is? and finally, can the free-market system survive all of this? tonight we learn about mr. paulson's thinking behind all those decisions take none response to the financial crisis. and, ultimately, in the pursuit of long-run american prosperity. here with me now in washington, d.c., the former treasury man, henry paulson. hank, thanks for doing this. >> great to be here. >> let me say as someone that read the manuscripts, it was a hell of a book.
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i loved it. i couldn't put it down. i read it in the course of three or four days. let me ask you this. you were here in this very spot in the spring of 2007. we interviewed and the first stirrings of the crisis began more from reports about subprime mortgage failures and some bank issues. a month or two later you had the crisis which triggered in france. okay. then you take this narrative down to 2008. let me ask you this -- in '07 you said it was containable. you were still an optimist on the economy. you were still an optimist on the financial system stuff. why wasn't it containable? >> larry, you know, one of the things that i recount in the book is the very first major meeting i had with president bush. i asked for the topic to be
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about what i thought was the likelihood of having a credit crisis. and he asked me, he said, hank, what would cause it? and i said, i don't know. it's almost impossible to guess. who would have guessed that the russians would default and that would cause a crisis in '98? but after the fact, it will be obvious. there's just a lot of dry tinder out there and i'm not sure what will light the spark. now why did we say it was contained? and i -- >> you said it, mr. bernanke said it. a lot of people said it. and then i said it after you said it. >> i know it. and you're on optimist. >> i am an optimist. >> in terms of why i thought it was contained was, first of all, i was talking about subprime and we made the mistake of just simply saying the subprime was
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not big in relation to a 13, $14 trillion u.s. economy. and what was really going on is we were talking about housing overall and since world war ii, housing, residential home prices, had generally gone up. and the mortgages were just considered to be very safe investments. and so the kind of decline we saw was something that was not envisioned in any kind of model. it wasn't anything that many people that were close it to -- after the fact, it seems obvious to all of us. but the -- and so when you had the kind of decline we saw in housing prices that changed the behavior of those of homeowners, and, also, the other thing you
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and i were talking about before the show is this -- all of this complexity. so when -- it. >> it's crazy. mortgage-backed securities that were rated triple-a by a bunch of goofy raters that didn't know what they were talking about. >> and the level of complexity made -- when the housing prices declined, all kinds of complex products became suspect because people said, who understands it? >> let's shift the narrative. you maybe saw the first sparks of problems back in 2007, mid year, for argument's sake. switch to six or nine months later. march of 2008, bear sterns faces a run on the bank and you have to close them and you sell them to jp morgan. as you say in your book, march of 2008, probably the most extraordinary thing in the history of finance, eight major financial firms failed and that doesn't include putting merrill
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lynch inside of bank of america. in a sense, merrill would have been nine. we have a full screen of what the eight were. leaving that aside, bear sterns, indy mac, fanny and fred did and lehman and aig and let's not forget washington mutual, wachovia and somewhere in there, did i mention indy mac? >> it was an incredible -- >> incredible jump-shift in the space of nine months to a year we had a total collapse of these institutions and, yet -- >> the u.s. alone. because you had -- if you look from september through the first part of october, we had six european nations have to come in and rescue a whole series of
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banks? >> what happened? you had this yb in effect, a rolling run on the bank. that's really what you had. you can define it and make it complex, but basically, you had a run on the bank, investors, depositors for liabilities that were not insured. open-market trading funds and all the rest, just took off and all the sudden you're in this incredible crisis. the credit markets freeze and you couldn't even have bank to bank trading. money market fund went down. let's not forget that, the reserve primary fund. what happened? there's got to be some rational explanation to get from the middle of tho'07 to the autumn '08. >> you need to understand what happened before the middle of '07. which is you'd had these excesses had been building up for sometime. we had been overstimulating housing. so if you look at the combined
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weight of all of our policies of the u.s. government -- >> it's hud-backed unaffordable mortgage loans, fanny aie and fredd freddie. >> and various state programs. >> community reinvestment act? >> mortgage interest deduction. i'm not saying that any of them were -- >> zero capital gains tax on home sales? >> right. so you had all of this going on and then you had, even more basic than this, you had these big global economic imbalance, structural imbalances that stem from the fact that we as a country, save not enough. both as a government and individually, overreliant on debt and so -- so you had these big structural imbalances. we have a tax system that penalizes savings and really, rewards consumption. so you had these huge capital
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flows, global capital flows reigning down through the banks and so it was something economists would talk about this and they would talk about it -- i remember someone even using this term that was -- stable equal lib yum. and then you have in 2007 -- >> before we get to '07, hank, you have praise of ben bernanke. a number of pages. you call him the most april yabt guy. he's a nice man. he shows up on time for meetings as i recall, you like that, too. but so many of us believe that the fed's ultraeasy money with greenspan running the fed in the early part of the decade and bernanke as intellectual co-pilot. ultraeasy money.
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ultralow interest rates. negative real interest rates helped the housing bubble, the commodity bubble and you know as a former wall street veteran, you throw negative real interest rates at wall street traders looking for yields to please customers and whatever, that's like throwing blood into the water for sharks. and they just oh of what goes around comes around. after the fed finally figures out that they were too easy and the inflation rate started rising to 5 or 6%, then they tighten the screw from pillar to post. if you look at the chart. real interest rates were 4 or 5, 6% by the time we get to '07 or '08. then they clamp down on them with a huge liquidity squeeze. why aren't you more critical of the rock n' roll monetary policy? >> what i looked at and this was my view of it. my view of the world was inflation was very low,
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globally. there was -- the world was a wash in excess liquidity and so, in this world, investors were reaching for risk and mispricing it. but to get to your basic question -- >> how easy to misprice when the fed mispriced it own monetary -- >> but to get to your basic question which i think is critical when you say -- why did you get this chain of bank failures suddenly? you had -- remember, the crisis hit in the late july or august period of 2007. before we got to bear sterns, this had been going on the for some time and it was taking its toll. i think that given some of the accounting conventions and so on, the losses were not
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realized -- >> but something happened, hank. here's the thing. i don't want to dwell on this. your narrative is this was financial armageddon peering into the abyss. i think you're right. we need to talk about why the rest of the public today doesn't understand that. but i'll come back to that. it seems like when they big banks, brokers, mortgage lenders and let's not forget countrywide that went down -- something happened between bear sterns and, i don't know, merrill lynch, something happened so the system turned off. what was the event that happened? a it turned a down noourn a catastrophe. >> first of all, this has been building up tore a long time. these institutions, there was, i think they didn't adequately understand the need for liquidity cushions. there was a lot of focus on capital which is important but i think they didn't have adequate liquidity. i think it was a complexity of
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products. but, again, they were -- i was aware from august of 2007 right up through that period, how severe the problem was. >> i'm not blaming you. there's no perfect foresight in this game. >> but i was just saying that -- >> nobody blames you but the question is in terms of how this thing hit, what was it when we wake up in the fall of '08 and it's a total catastrophe? something must have happened. >> here's the point i'm trying to make which is, i saw it hitting in august of 2007. and it was beneath the surface. so it was building and building and the system was becoming more and more fragile. >> and you're still going to defend the fed during this period? >> it was hard. we were working with the fed during that period. we were working jointly with the fed trying to get institutions to raise capital. and trying to get them to raise capital why they should could raise them and i was calling up bankers and saying -- i don't
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know of a single ceo of a major bank or any bank, that's got none trouble for raising capital. but they viewed it as a sign of weakness. >> we'll take a break here. i understand that and i agree with the capital issue. i think that's a key part of the solution. but all i'll say is this -- wouldn't it be nice to have a steadier monetary policy that didn't go on -- let's take real interest rates. the inflation rate was 5% and then went down and then went to 6% for a while in 2006 to 2008. they blew their targets. wouldn't it be nice to have a central banking policy that didn't fluctuate from a negative 4% real rate to a positive 4 or 5% real rate? because i submit, that was an ocean that drowned first it created the waters and then it took the water out. this was a liquidity squeeze of the first magnitude. first they pump it up and then they deflated it. that's has to be part of the issue here. >> i have looked -- i'm not trying to debate it. i've just looked at, from my
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perspective and from a banker's perspective, i saw huge complexity, much of it unwarranted. i saw big capital flows stemming from imbalances. and with the world awash in that kind of liquidity from the capital flows and low inflation around the world, you got it from me, not an economist, not a monetary economist but a banker. and when we were working to put out the fire i could not have had better partners. >> well get to the put out the fire part. we'll take a break. we have mr. paulson here for the entire hour. we'll talk about market-to-market accounting where he'll totally disagree with me. we'll talk about lehman and we'll talk about aig. we're going to ask former secretary whether he put a gun to ken lewis's head to buy
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live in washington with former treasury secretary, henry paulson, a special edition of "the kudlow report." we're live with hank paulson talking about his brand new book. it really is the first inside government account, what i call, straight from the horse's mouth. hank, you honor us by this and it was a terrific book. we're talking about what it was that changed from '07 to the end of '08 when the crisis really started to crash around us. i want to ask you about one and you're going to disagree with me. market-to-market accounting. a lot of people, in fact, steve forbes and the editor and chief
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of thop forbes magazine has another editorial and he said when the financial accounting standards board reinstituted market-to-market accounting, that these banks had to market to a nonexistent market. that they moved away from cash-flow accounting. that the fasbi changed and it happened in the middle of 2007 and it seems a peculiar co-ins dance that in 2008, when banks reported terrible earnings because they were marking down their assets as much as 80%, this helped to contribute the run on the banks, the lack of confidence and the credit freeze-up. >> i disagree very strongly. i know that reasonable people disagree on this. but having run an investment bank, i don't know how to do it if we didn't have the discipline of knowing that every asset had
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to be marked because i wouldn't know how to do it if you had a different book in terms of what a security is worth from what you had actually paid for it originally. if you had -- the way i think about it is that there's a marvelous discipline about having to say every day what is this -- >> even if there's no real market -- >> i've got to say -- >> because opposite is cash-flow accounting, right? they were servicing 70% of these bad, toxic loans. >> but if something is worth, i would say -- there's no perfect accounting system, none. but to be able to -- i just spent too much time in the financial services industry
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worked with banks all around the world. looked at what it's like when accounting goes awry and you use historical accounting. and you use that to hide and cover up losses. and the thing that i knew for certain in this -- actually, i believe that if there had been if there had been adherence to market-to-market accounting maybe the exsakp excesses would have built up to that point. the first part of the crisis, the problem i had, was to get banks to recognize the losses and raise capital. >> with respect, at the time -- now i'm going to switch to early march of 2009. >> right. >> and democratic congressman barney frank -- and you speak very well of barney frank in the book -- they'll really pushed
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fasbi to change market-to-market and go back to cash-flow accounting and that was almost, to the day, the absolute bottom in the stock market. and is that just a coincidence? >> it is a coincidence? >> it is a coincidence? >> it is a coincidence. if it were 72 degrees -- >> to the day -- >> if it were 72 degrees that day, that would have as much to do with it. i got to tell you, the one thing i feel strongly is that politicians should not interfere with accounting. that is, to me -- >> maybe, you know what, maybe war is too important to be left to the generals. maybe this is too important to be left to the accountants because they took a long-run view. the bank also get out of this in the long run, maybe. >> i remember going up to the hill and having meetings where i would say -- where i had a number of congressmen say -- the banks in my district don't have a problem. they don't have losses.
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they've just got problems with this market-to-market accounting. and i felt like saying, do you know what you just said to me? you just said they have losses but they want to hide them. >> some people think there are different ways. if you're servicing the loan even though it's a temporary value, if its temporary value comes down and you're servicing the loan, why is that a bad loan? and it works in the reverse. during the bubble, they were overvalued. >> i would look at it where a bank would have it on its balance sheet in one place, the historical value, and they would be trading the same loans in the broker deal with 60 or 70 cents on the dollar. >> it has to be consistent and transparent. >> i do agree that in the middle of a crisis, where there is no liquidity, okay, where there is no liquidity, that market to
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market accounting could be an accelerator. >> that's my first concession from you this evening. >> but there's no system that's perfect. and i believe that with market-to-market accounting, we -- it would have been less likely to get to the problem to begin with, recognize losses. >> one other one before the break. i don't mean to be abrupt but there's so many things to talk to you about. i need you for three hours but i only have you for this hour. fannie and freddie taking over by the government into so-called conservatorshipst and then lehman brothers goes down into bankruptcy. and then, bang, aig is essentially rescued or bailed out, whatever you want to call it. a lot of people think that those conflicting signals of policy helped to create the credit freeze-up. with this, with this, with this. i'll wait to the next segment to talk to you about t.a.r.p. and go on from toxic asset buys to capital buys.
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but on this point you saved fannie and freddie. lehman went under and aig was saved. people said, huh? we don't know who's next. >> let me explain, first of all, i haven't heard the same argument yet why stabilizing fannie and freddie led to the crisis. >> only in relation so letting lehman go down, sir. that's what i'm saying. there were what you call mixed signals. >> i would say this. with fannie and freddie, i viewed that as the most important steps. there were $5.4 trillion of the securities out there. that is huge. if those organizations come really unstable or gone down, we would have had an absolute disaster. so part of the story in the book, as i tell it, is the race
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to get that done. that was not easy, before lehman was announcing its earnings. i was naively hopeful for a short time that maybe that would be such a positive for the world to know those were, stable it would have staved off lehman. in terms of mixed signals. >> you any if the world knew that fannie and freddie were stable that would have stopped the run on lehman? >> i was hopeful. >> work me through that. i'm not sure i understand that. >> i was hopeful. what happened -- when you look at $5.4 trillion in securities held all over the world, if you find they're stable and the credit spread shrinks, they are no longer worried about will mortgage financing be available? that was -- it's not stabilizing to know that fannie and freddie have come unglued, right? >> may be not so stabilizing to
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know they are permanent wards of the state. >> no. i don't like -- they shouldn't be. the step we took was to be a time-out and to show to everyone the current structure wouldn't work, is greatly flawed and needs to be changed. >> nobody disagrees with that but i'm saying that there was this up and down policy. >> let's get to your basic question. there was not -- we didn't have all of the authorities we needed. so we raced -- we worked with congress and got just, in the nick of time, the authorities we needed to keep fannie and freddie from going down. we had bear sterns was quite interesting for us. with bear sterns we had a buyer -- the best buyer in the world because you had a jp morgan, strong credit, a ceo that was decisive and had the confidence of his board. and so was able to do a deal.
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going that that weekend, we knew that bear sterns had already started to unravel. the run had begun and that if we didn't that first weekend with a deal with jp morgan where they had agreed to guarantee the trading book during the pendency of the shareholders vote, this company would disintegrate. so what we learned that weekend and we knew it theoretically beforehand, but what we learned is that when you have a investment bank a capital and a liquidity issue, we didn't have the authorities to deal with it in government. and so at the time we didn't -- >> but with the rest of the world watching this including all these big financial institution and hedge funds and private equity funds who were putting in liquidity and taking liquidity out. wouldn't it have been better after you completed the bear sterns action in march of 2008, to lay down a clear policy line
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about who's going to win and who's going to lose and how? wouldn't it have been better to do that? it got very ad hoc in september and october? >> let me say this. i look at it, we were doing this until we got there with t.a.r.p., we were late all the way along as we tried to put out the fire. but the policy line, we didn't change policies. the facts changed. so, for instance, we did everything we could to save bear sterns. we stabilized fannie and freddie and put them into conservatorship. and with lehman, we would have loved to have done -- been able to present -- prevent that failure. but in lehman, you didn't have a buyer to fill the hole. >> i'm not criticizing the decision. i'm just saying it was like some were up. some won and some lost. >> see, the perception, there
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was only one that -- where we were unable to save and that was lehman. and so the inconsistency and what people miss, there were two issues with lehman. okay? we didn't have a buyer to fill the capital hole and guarantee the trading book and the fed didn't have the power to do that. >> and the british regulators wouldn't sign off on that. >> and we didn't have that and number two, if there had been someone, there still would have been a challenge given the size of the capital hole for the fed to make the same loan it made for bear sterns, that would be secured to the satisfaction -- but that's why we worked with the private sector. >> we'll take a break. when we come back i'll talk about the aig bailout and trading partners with aig like goldman sachs. i want to talk about the populist revolt against t.a.r.p. and bailout nation. and we're going to talk about some of the individuals that mr.
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paulson dealt with, including barack obama and jane and, of course, president george w. bush during this faithful period. staring down the abyss, i agree with that. the question is -- did we get it right? stay with us.
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welcome back here. i'm live with former treasury man, hank paulson, at the very center of the financial crisis and writes bt ait in detail on this book called "on the brink" rising up the amazon.com list. t.a.r.p. is a hated word politically. bailouts, hated politically. poppism from the left and from the right. and aig, a three-lettered dirty word. hated politically. i'd like to zero in on that. first of all, what can you tell us? >> let me start with t.a.r.p. being hated and in some ways i think it's good because we, as a country, don't like bailouts. and the president said it in the state of the union. he said, republicans, democrats, all of us -- and you know, i hate it. i hated the things i had to do.
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it was much better than the alternative, which was armageddon, as you said. but the -- i remember looking at a poll once and it put us all in perspective for me. i said -- it said, 93% of the people in the u.s. were against the bailouts. i was trying to figure out who the other 7% were. but it says 60% were against torture so that put it at all in perspective. and -- >> but they say if you pay down your t.a.r.p. bailout then people say you're okay. >> i would say this. i believe that we're going to get -- we designed these programs to maximize the likelihood we get we get it all back. we will get everything we put back in the banks with a nice profit. i think, as we look at it over a five-year horizon, i think people will be surprised on the
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upside in terms of getting either all of it back or most of it back. and if you look at everything, that includes some of the money for the actual spending programs, as opposed to investment programs. >> were you aware of the aig brouhaha -- it's like the story that refuses to die. we bailed out aig. then comes the second wave of the story that the aig trading partners were bailed out 100 cents on the dollar, including your old firm, goldman sachs. and this has created another fewer roar and a furor around tim geithner. were you aware that the new york fed was trying to prevent full disclosure on the amount that the goldman sachs trading partners got in the aig bailout? had you heard anything about that? >> larry, i had heard absolutely nothing about it. when i say that which is -- i had heard nothing about it. i wanted to -- >> on the secrecy, the
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nondisclosure? >> absolutely. i had had not only had i heard nothing about disclosure, but i had no involvement in the decisions related to how to deal with the counterparties and how to pay them. >> the 100 cents on the dollar payout? you were not part of that decision? you were in the center of every decision at the time. >> but i want to come back, first of all because, i want to just say that oh strongly, how much i support the fed's action. how necessary it was. and -- >> for secrecy over this cover-up? >> no. in terms of bailing -- in terms of the rescue of aig and that loan and i'll tell you. the other thing i just feel very strongly about is having worked with the people i worked with there. and knowing what their motives were. >> at the new york fed. >> but they made a huge blunder,
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hank. they never should have allowed this secrecy cover-up thing to get out of the bag. >> i'm for transparency. but i will say this. i know these people. i know what their motives are. i know how hard they're working to save the system. i know their professionalism and their integrity so i'm not going to second-guess. i will be the last person to second-guess what they did into you with second-guessing the decision to pay goldman sachs and others 100 cents on the dollar? >> ok -- >> and what kind of trouble would goldman have been in if they hadn't received that? that's a key issue. did we rescue goldman through the back door? >> i would say very clearly that when aig was rescued, that aig was rescued to prevent a meltdown of the system.
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that this company, if it had gone down, it would have taken everyone down. and as i look at it, and what i've said, i can just tell you what -- i believe in the very strongest way, it was the fed's motive, that was all of our motive at the time the loan was made, that the last thing on my mind was any counterparty's exposure or claim. >> who the heck did this? >> it was -- once the loan was made, okay? once the loan was made it was the fed's job to administer the loan. we were all very busy. i was very busy doing other things. >> the world was going to hell in a handbag. >> this comes back at you. >> i got to tell you, there was an awful lot going on and, again, what the fed did, i will
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never second-guess. and in terms of the decisions they made, i'm totally confident knowing them, they made -- any decision they made in the best interest of the system and the country. >> i still think the fed made a big mistake on this but, whatever. we'll be back with hank paulson. we'll talk about president george wirks bush's role and we'll talk about john mccain and barack obama, two people mr. paulson had a lot to do with in the late fall of 2008. and we'll talk about tim geithner, the treasury man everyone loves to hate. maybe geithner has better stuff than we know about. we'll be right back. we know why we're here. to redefine air travel for a new generation. to ensure our forces are safer and stronger. to take the world we share to tomorrow and beyond. announcer: around the globe, the people of boeing are working together--
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live from washington, with former treasury secretary henry paulson, a special edition of "the kudlow report." welcome back. we're talking about hank paulson's new book "on the brink." a terrific read. the first and only inside government account. i call it straight from the horse's mouth. during this fateful period, and i agree with you, it's -- but on the other hand you spent a lot of time on the phone with barack obama and john mccain. my reading of these, you felt
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that obama was much more measured in helpful and you did not think that way about mr. mccain? >> larry, there was no doubt that i had easier conversations with senator obama, at the time, than with senator mccain. but both men supported the t.a.r.p. legislation ultimately. >> in the end. >> and both supported the -- neither came out against the rescues. and as i look back on that, and as i looked at it at the time, i've always been very grateful for john mccain for taking that position, because as he fell behind' in the polls, it would have been very easy to play the populist card. and if he had, we would have
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been defenseless and we'd have 25% unemployment. so as i look at it, it was a -- we were very fortunate because the crisis came at the very worst time. it came six weeks before the election. and so everyone, at the hill, both candidates, they've got to go through this with one eye on the polls and, of course, anything that even looked or smacked of a bailout is -- was going to be very unpopular because in our system, if a risk takers are supposed to bear the spontsability for their losses. -- the responsibility for their losses. the idea of having public assistance for any institution, let alone a bank with private profit, is -- and it should be, so this was going on and -- >> i got to go lightly.
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you're too good. you're just too good. i got to go to george w. bush. you speak highly of bush. one of bush's speechwriters wrote a book and said that he was completely des engaged in the financial bailout and in your book, you're repeatedly briefing him on the phone or in person and he has to sign off on your major decisions, half of which on the bailout stuff he didn't want to sign off on but he did because he felt it was for the good of the country. am i giving an accurate reading? >> you're giving an accurate reading. and that is very accurate. i didn't keep notes. i've got a good memory and a lot of people do. there were good notes in the white house and good records. and -- i would say that it was from day one, this is a man who was very engaged. we spoke frequently.
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every major decision was reviewed with him. understood the politics and the markets and the book is a collision between markets and politics. he was the one that always said this may not always look good. this is going to be ugly. we're going to have to hold our nose or what have you. but we're not going to let a lack of doing the right thing here hurt the american people and the economy. >> he said, real quick. one-word answer. he said, in order to save the free market system we have to suspend it. do you agree with that? >> yeah. yup. >> much more coming with secretary hank paulson. we'll talk about nancy pelosi, tim geithner and, also, spiritual guidance during the darkest period of the night.
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live in washington with former treasury secretary, henry paulson, a special edition of "the kudlow report." we've got a brief lightning round left with hank paulson former treasury man on his book "on the brink." a very good read. one thing i want to get out of the way.
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a lot of people said you bowed down to house speaker nancy pelosi. in your book you suggest that she wasn't all that helpful to your process of getting t.a.r.p. through. can you give us a quick -- >> i thought she was helpful and i thought it was pretty clear she was. i needed to work with the leaders on the hill. and if nancy hadn't been as supportive as she was we would never have got it through and i tell the story in the book of that night, september 27th, a saturday when we negotiated it, and i think she just all the way along, there she played a key role in bringing people together and getting it done and said, the american people expect this. >> is it because you kissed her hand or because she wanted to do it for the good of america? >> she wanted to do it for the good of america. >> say no more. >> i'll tell you -- >> no, say no more. i got to ask you this. i'm a spiritual person and so are you and so are our wives.
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you sought spiritual guidance during the worst part of this. >> yes. >> tell me about that. >> prayer is an important part of my life and continually prayed for humility and, you know, strength and stamina and wisdom. >> we don't know everything, do we? we just -- we don't know everything? >> yes. and it was -- it was very important. >> and your wife read scripture to you at one point on the phone? >> yes. she read scripture to me the more than one point. >> did it work? >> it sure helped. it was a verse that was very meaningful to both of us in dealing with this. >> there is a lesson for all of us. a little scriptural help. that's it, we're running out of time. a hell of a book. join us for "on the brink" and there was a brink and he's written a brilliant account. coming up, my last us thought.
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that really hit me, and got me thinking about my health. i knew i had to get my cholesterol under control. but exercise and eating healthy weren't enough for me. now i trust my heart to lipitor. (announcer) when diet and exercise are not enough, adding lipitor has been shown to lower bad cholesterol 39 to 60%. lipitor is backed by over 17 years of research. lipitor is not for everyone, including people with liver problems and women who are nursing, pregnant or may become pregnant. you need simple blood tests to check for liver problems. tell your doctor if you are taking other medications or if you have any muscle pain or weakness. this may be a sign of a rare but serious side effect. i thought i was doing enough to lower my cholesterol. but i needed more help. what are you doing about yours? (announcer) have a heart to heart with your doctor about your cholesterol. and about lipitor.
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there can be little doubt that hank paulson's basic narrative that we were totally on the edge, on the brink, on the abyss, was the key point. that's why you should buy the book "on the brink." i'm larry kudlow. see you tomorrow night.
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>> ferdinand porsche. under the thumb of a dictator, he designed cars that embodied ferdinand porsche.embodied under the thumb of a dictator he designed cars that embodied speed, style, form and function. >> it's the 8-year-old who understands what a porsche is better than anyone because they recognize what it is, is a it's an 8-year-old that understands what is a porsche is better than anyone. they recognize what it is as a rolling dream. somebody's dream on wheels.
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>> but the road to this pure dream was full of twists and turns. it consumed the lives of two very different men, ferdinand and ferry porsche. father and son. >> translator: my father reached his goal with sensitivity and understanding. my grandfather could be hard tempered. one time he threw down his hat and danced on it out of anger. >> along the way the uncompromising family patriarch ferdinand porsche would put cars within reaches of the masses. >> to give everybody an automobile. i think that was the most important thing in his life. >> but it would take an unholy alliance with a dictator to realize his vision. >> hitler felt porsche could do almost anything. >> and their partnership would come with a price.